Dell Brings Hyperscale Units Under Single Organization

Dell is creating an umbrella organization that will house the business units that build customized and optimized infrastructure offerings for hyperscale companies like Google, Facebook and Amazon and the myriad organizations just below them, ranging from oil-and-gas firms to telecommunications service providers.

Dell's new Extreme Scale Infrastructure (ESI) organization, which was announced Dec. 10, will encompass both the company's 8-year-old Data Center Solution (DCS) unit and the Datacenter Scalable Solutions (DSS) business, which was launched in August.

The ESI organization was created to give more clarity to the industry around Dell's hyperscale strategy and lineup and to bring all the tools, resources, strategy and employees under a single roof, according to James Mouton, the former Hewlett-Packard executive who came to Dell about two months ago and now is vice president and general manager of the division.

In a post on the company's blog, Mouton said customer feedback on Dell efforts and plans in the hyperscale and sub-hyperscale market has been "overwhelmingly positive—no doubt about it, Dell is delivering the scale, flexibility and performance customers need."

However, there apparently was some confusion about the relationship of the DCS and DSS units.

"What needed to be better communicated to customers, however, is that DCS and DSS is one team," he wrote. "ESI reflects our commitment to customers and partners, and allows us to better communicate our team's broad capabilities to uniquely serve our customers."

Dell launched DCS to address the need for fast, scalable and customized infrastructure offerings that are optimized for their workloads and that can be delivered and deployed quickly. The DCS unit is aimed at the handful of the largest of the Web-scale businesses, including Google, Facebook, Amazon, eBay and Baidu.

With the success of the DCS effort and the experience the vendor has gotten from running it, Dell in August unveiled the DSS initiative for organizations that aren't as large as the hyperscale players, but still need customized and optimized infrastructures that are differentiated from the PowerEdge systems that Dell sells to enterprises. Along with telcos and oil-and-gas firms, these organizations can include Web tech companies, hosting businesses and research groups.

They have many of the same needs as their hyperscale counterparts, but not the same financial or engineering resources, Jyeh Gan, director of product management and strategy with DCS, told eWEEK in August. They deploy huge numbers of servers, but may not have as many as those larger players. They like Dell systems, but need to make tweaks in order to run their workloads at optimal levels.

That next step down from the hyperscale organizations is an attractive opportunity for Dell, Gan said. The scale-out market is growing three times faster than the traditional x86 server space—at about 14 percent a year—and represents about a $6 billion total addressable market. In 2013, it accounted for about 17 percent of the overall x86 server market. That will grow to 25 percent by 2017, he said.

Overall, hyperconverged solutions are gaining in popularity as businesses look to reduce costs and simplify their data centers. According IDC analysts, the market will grow 60 percent between 2014 and 2019, hitting $3.9 billion in revenue in 2019.

Most system makers are building out their hyperconverged offerings. Hewlett Packard Enterprise officials this week announced a lower-cost, two-node version of its Hyper Converged 250 solution aimed at SMBs and remote enterprise offices.

According to Dell's Mouton, the ESI organization will give customers a better understanding of the DCS and DSS units, which he said are a single team that is applying the years of experience gained by serving the largest companies to its efforts with a broader range of hyperscale and sub-hyperscale customers, has a broad range of expertise from validating unique configurations to designing and building custom offerings and modular data centers, and can leverage Dell's vast supply chain capabilities.

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